Diet, Economic Development and Climate Change

We develop a quantitative, multi-country general equilibrium framework to study the impact of economic growth, dietary restrictions, and food trade policies on global greenhouse emissions (GHG) from agriculture. Motivated by new cross-country rela- tionships between economic development, diet patterns, agricultural technologies, and GHG emissions, our framework features different income elasticities of demand across food products, and multiple agricultural technologies for production across grid-cells covering the surface of the Earth, with food products and technologies being heteroge- neous in their GHG emissions per calorie. Using our model’s open economy structure, we propose a simple procedure to estimate the income elasticities without price data. GHG emissions from economic growth is understated by one quarter if diet and tech- nology changes are shut down, and overstated by three quarters if global food supply readjustments are ignored. Compared to food trade policies, dietary restrictions are both substantially more effective in reducing GHG emissions, and more favorable when considering the welfare losses in developing countries.